ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

Bishwanath GoldarSubscribe to Bishwanath Goldar

Productivity in Indian Manufacturing (1999-2011)

Studies on total factor productivity growth in Indian manufacturing that apply the growth accounting methodology do not distinguish between domestically sourced and imported intermediate inputs, which could bias TFP estimates. Using Annual Survey of Industries data, estimates of TFP growth in Indian manufacturing industries during 1999-2000 to 2011-12 are presented. TFP estimation was done by constructing separate series on domestically procured and imported materials input. Productivity estimates obtained in the study indicate that TFP growth in manufacturing industries during 1999-2011 tends to get understated if imported materials are not separated out from domestically procured materials. For aggregate manufacturing, TFP estimates, corrected for aggregation bias, indicate that there was a rapid growth in productivity.

Growth in Gross Value Added of Indian Manufacturing

There has been criticism of the 2 percentage point hike in the 2013-14 real gross domestic product growth in the new National Accounts Statistics series and some observers have therefore been sceptical about the new series. There is, however, evidence that the growth rate in real gross value added of manufacturing in 2013-14 was probably about 5% or higher though it was reported as a negative 0.7% in the previous NAS series. Since manufacturing accounts for about 18% of GDP, more than half of the hike in the growth rate for 2013-14 between the two NAS series can therefore be explained in terms of a required correction in industrial growth rate estimates.

India's Exports at the Time of the Global Crisis

India's exports to the European Union and the United States during the diffi cult economic year of 2011 held their own, while those by China faltered. Was the Indian export performance real or a statistical artefact?

Impact of Tariff Reduction according to Doha Modalities on India's Trade of Agricultural Products

This article attempts to estimate how India's trade in agricultural products will be affected by tariff reductions according to the tiered formula of the 2008 draft modalities in the Doha round of the World Trade Organisation. The estimates indicate that the reductions in agricultural tariff rates will lead to an increase in India's imports of agricultural products by about 1% and an increase in its exports of agricultural products to the us and us markets by about 2% to 4%. India has probably more to gain from the implementation of tariff cuts according to the tiered formula than to lose from it. However, the overall effect of the tariff cuts on India's agricultural exports and domestic agricultural production would be small

Organised Manufacturing Employment: Continuing the Debate

In response to an earlier article ("Growth in Organised Manufacturing Employment in Recent Years", EPW, 12 February 2011), R Nagaraj has questioned two assertions ("Growth in Organised Manufacturing Employment: A Comment", EPW, 19 March 2011). He argues that the recent manufacturing employment boom could be merely a recovery of employment lost over the previous nine years, and that the correlation coeffi cient between employment elasticity and labour reforms index across states is not statistically signifi cant. A response to each of these contestations through additional empirical evidence.

Growth in Organised Manufacturing Employment in Recent Years

Employment in India's organised manufacturing sector has increased in recent years at the very rapid rate of 7.5% per annum between 2003-04 and 2008- 09. The impression of jobless industrial growth prevailing for some time is therefore not valid any more. What could possibly account for this high rate of job creation in organised manufacturing since 2003?

Trade Liberalisation and Labour Demand Elasticity in Indian Manufacturing

The hypothesis that trade liberalisation raises labour demand elasticity is tested for Indian industries, and inter-temporal changes in the elasticity during 1973-74 to 2003-04 are analysed. Econometric results indicate that trade liberalisation in India had a positive effect on the labour demand elasticity. However, the estimated elasticity for the post-reform period (1991 onwards) is found to be lower than that for the pre-reform period. A closer examination reveals a marked upward trend in the labour demand elasticity after the mid-1990s, which seems attributable, among other factors, to trade liberalisation, weakening of trade union bargaining power and labour market reforms.

Likely Impact of Reforming Water Supply and Sewerage Services in Delhi

This study was undertaken to gain an understanding of the baseline water supply and sewerage services in Delhi, and assess consumer coping strategies and associated costs, their preferences for service improvements, willingness to pay and affordability for the preferred options. For this purpose, a representative sample survey of around 8,000 households and about 2,000 non-domestic consumers was carried out. The survey results bring out the deficiencies in services, and the significant coping costs the consumers are bearing. The survey data reveals that the consumers are willing to pay - and can afford - the extra cost that service improvement will entail. The analysis of survey data indicates that, for poor households in informal settlements, substantial improvement in water supply can be made by introducing/implementing paid group connections. Significant social gains, which could be as high as Rs 5,500 to Rs 8,000 million per annum, are expected from the efficiency improvements in the present system and other reforms that could be undertaken by the Delhi Jal Board.

Contribution of Services to Output Growth and Productivity in Indian Manufacturing

As an input into the production process, services are playing an increasingly important role in manufacturing industries the world over. Yet, this has received very little attention in the empirical economic literature on producer behaviour and productivity. This paper estimates the contribution of services to output growth and productivity in Indian manufacturing using the capital-labour-energy-materials-services production function. Panel data estimations are undertaken for 148 three-digit level industries for 18 years, 1980-81 to 1997-98 and sources of growth are analysed. The results show that the contribution of services input to output and productivity growth in manufacturing (organised) has increased substantially in the 1990s. One of the major causes for this is found to be the trade reforms undertaken in the post-1990s period.

Manufacturing Productivity in Indian States

This paper analyses the influence of the investment climate on total factor productivity in the registered manufacturing sector across the major Indian states. We find that a market friendly investment climate is important for achieving higher levels of productivity. This conclusion is robust, unaffected by the choice of the investment climate indicator. A market friendly investment climate, however, does not mean that the regulatory function of the government should be done away with. Government regulation is crucial to address market failures and to protect social interests, but the policies and practices of the governments should be transparent and designed without distorting the incentives of the firms to invest and grow

Indian Manufacturing: Productivity Trends in Pre- and Post-Reform Periods

Contradicting the findings of several earlier studies, recent studies on productivity trends in Indian manufacturing by Unel (2003) and Tata Services (TSL) (2003) have concluded that total factor productivity (TFP) growth in Indian manufacturing accelerated after the 1991 economic reforms. This paper presents an alternative set of estimates of TFP growth in Indian manufacturing in the last two decades, which have largely been made following the methodology of input and output measurement adopted in the studies of Unel and TSL, but avoiding the methodological inadequacies noticed in them. The estimates indicate a slow down in TFP growth in Indian manufacturing in the post-reform period, and thus do not bear out the findings of the studies by Unel and TSL.

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